Analysis of Singapore's Economy -Tanisha Diggikar (Grade 11, HL1)

A few quick facts about Singapore-

Population: 5.47 Million

GDP: $348.7 Billion (1.8%)

Inflation (CPI): 2.4%               

Singapore has a highly developed market economy. Its economy has been ranked as the most open trade friendly economy in the world. It also has very low tax rates and has the third highest GDP in the world.

Singapore’s economy is booming since after independence. Singapore has adapted to trade of high-value added products in the last decade, and is now one of the center countries for gadget innovation. The country has gained success in many outward oriented development strategies. As Singapore has a low tolerance for corruption, they have effective laws that are strongly undergirded at all times.

One of the main reasons that Singapore’s economy has flourished rapidly is the increased share of business sectors in the economy itself.

Singapore's total trade in 2014 amounted to S$982 billion. Despite its small size, Singapore is currently the fifteenth-largest trading partner of the United States. In 2014, Singapore's imports totalled $464 billion, and exports totaled $519 billion. Malaysia was Singapore's main import source, as well as its largest export market, absorbing 18% of Singapore's exports, with the United States close behind.

The Government of Singapore changes its economic strategies every few years, to make a more challenging as well as efficient base for business’ to function on. The Government of Singapore is working towards making it a world know financial center as well as business base.

In 2000, Singapore had a workforce of about 2.2 million. The country has the largest proficiency of English language speakers in Asia, making it an attractive place for multinational corporations. The National Trades Union Congress (NTUC), the sole trade union federation which has a symbiotic relationship with the ruling party, comprises almost 99% of total organized labor. Government policy and pro-activity rather than labor legislation controls general labor and trade union matters.

The regulatory framework of the country is one of the world’s most efficient. Starting a business in Singapore takes three days, and requires procedures that are straightforward. No minimum wage is required, but adjustments are guided by the NWC (National Wage Council). The Government of Singapore funds housing, education and health care subsidies.

Personal income taxes range from 0% to 20% for those with an income above 3,20,000 Singapore Dollar. There are no capital gains or inheritance taxes in Singapore. The corporate tax rate is 17% with added incentives for smaller businesses. It also has a single-tier income tax system, which states that there isn’t double-taxation for shareholders.

The trade organizations that are currently based in Singapore include:

1.      WTO

2.      APEC

3.      IOR-ARC and

4.      ASEAN

This economy has benefitted Singapore in many ways. Singapore benefits from one of the world’s highest levels of economic freedom, and has reinforced its commitment to continued reform.

Over the past few years, the country has advanced its economic freedom by 2.1 points. It is the largest increase in the score amongst the 10 freest economies. Constant efforts to build a world-class financial center, opens Singapore’s market to global commerce.

Singapore has a highly educated and motivated workforce in its economy. This dynamism and resilience, reinforces the country’s innovative capacity.

This interesting website provides us with very apt information related to the economy of Singapore.

Bibliography:

 http://www.sgs.gov.sg/The-SGS-Market/The-Singapore-Economy.aspx

http://www.economywatch.com/world_economy/singapore/?page=full

http://www.internations.org/singapore-expats/guide/16061-economy-finance/the-economy-of-singapore-16045

http://www.singstat.gov.sg